taxpayer assistance centers, the i.r.s. has decided to eliminate certain services such as tax return preparation that can be obtained through other chance. the i.r.s. assisted over 6.5 million taxpayers at these service centers in fiscal year 2013 but plans to reduce that year. by 14% this recognizes the

gentlewoman from florida, ms.

minutes. >> so, i want to thank all of you at american enterprise institute for the great work that you do when the opportunity to be with you today. as mckenzie said, secretary haeckel recently announced a number of recommendations and proposals that will be contained in the defense department fiscal year 2015 badges admission. it goes about pain that make in

spending choices as having more losers than winners due to the fact that budgets are tight and could get even tighter is no way to win a popularity contest. in many respects, there is something in the package to set up just about everybody's alarm bells and on which meter. from my perspective and as i hope my remarks will make clear, the two categories of stakeholders most protected from these changes are people we should all feel the most accountable to. the average american fighting man woman in the average american taxpayer. to best take advantage of our time today as well as this informed audience, i thought i would might be useful to provide a broader context, thought processes and strategic shift underlined the fy 2015 proposal. we are unveiling this latest budget at a time of continued transition and insurgency for the u.s. military in terms of its role, mission and available resources. the past decade has dominated by

the protected land wars in the middle east and virtually shut. today, in even as the fight weinstein in afghanistan, the military focus is preparing to counter a variety of security threats and embracing opportunities on all points of the compass. recognizing that america was answering this is doric inflection .2 years ago, president obama issues strategic guidance to the defense department that articulated ours.security priorities and most important military mission. because these priorities weigh so heavily on the recent veggie choice is, it is worth revisiting them briefly. ..

enhancing capabilities in cyberspace, maintaining a small, smaller but credible nuclear deterrent and continuing a military presence in pursuing security cooperation in multiple regions europe africa and south america though at reduced size and frequency. okay that list is not a short one. it reflects the president's chief objectives of protecting the american homeland and fostering stability overseas by supporting traditional allies cultivating new partners and deterring would-be adversaries.

v. strategic tenants are affirmed and refreshed in the 2014 quadrennial defense review scheduled to be released to congress with the official budget submission. all of the reviews in recent years have rautins into sharper focus to historic realities. first, as you can see from that list the world has gotten a less dangerous turbulence or in need of american leadership. there is no obvious peace dividend as was the case at the end of the cold war. second, there is a strong possibility that under current law most notably the return of sequestering in fy2016 resources for national defense may not reach the levels envisioned to fully support the president strategy. consider the recent fiscal history. the budget control act of 2011, even before the sequester provision was triggered. they reduce projected spending by $487 billion over 10 years.

the next two defense budget submitted by the president states generally on this fiscal fiscal course of last year's request added another $150 billion in reductions that loaded towards the end of the. map. as director dod cost assessment and program evaluation organization during this period i worked closely with the services the joint staff and the secretary on putting these budget plans together. while no government official in or out of uniform likes having their projected funding reduced, most senior military leaders consider the 2013 and 2014 budget plans supportive of the military's mission and global obligations as defined by the defense strategic guidance. then, of course the department along with the rest of the executive branch got hits with sequester just under one year ago today. with military compensation which represents one third of all defense spending off-limits by

sequester the operations, maintenance and investment accounts received disproportionately steep cuts. the result was more delayed modernization and readiness short that are still with us today. some relief and certainty arrived in the form of the bipartisan budget act signed in december. but, for 2014 and 2015 the vba still reduced its defense spending by more than 75 really an dollars relative to the budget plan submitted by the president last year. and without farsighted bipartisan action by the congress sequestration will return in fy2016 cutting defense by more than $50 billion annually through 2021. this brings me to the defense department's response to these fiscal challenges. with our leadership's stern warnings about sequestration appearing to fall mostly on deaf ears in the congress last year

one of of secretary hagel's top priorities is to repair the department for a narrowing defense budget lower than expected wanted or needed. the secretary recognize the those of us charged with helping to prepare the u.s. military for the future have to deal with the world as we find it as it is, not as we would like it to be either beyond our borders or within the boundary. in the political environment we are not likely to return to levels of spending favored by the most ardent defense proponents and organizations like aei on the hill or frankly in the pentagon. now the budget plan announced monday would provide $115 billion more over the next five years then sequester level funding. if it is a realistic puzzle that reflect strategic as well as the resources the department might reasonably expect to receive albeit with strong leadership

and cooperation in the congress. if enacted it will help remedy some of the damage article is by sequestration albeit with continued training and maintenance shortfalls in the near term and potential cuts in the future. if the $26 billion provided by the administration's proposed opportunity growth and security fund is also approved for fy2015 the military's near-term readiness picture improves significantly. the budget plan and associated proposals divide a sustainable path towards shaping the force able to protect the nation and fulfill the president's defense strategy. albeit with some additional risk. as the department assessed our strategic environment options in risks we have drawn upon work from outside organizations. aei has made important

contributions to our understanding on all of these issues. i will dive into a couple of areas and then close by addressing one overriding concern sequestration on which we should all be in agreement. there was a reason to exercise much aei and other think-tanks presented alternatives to the budgeting qdr. given concerns about potential near-term threats the budget that more of an emphasis on protecting readiness but otherwise there was a good deal of overlap in the overall thrust of your recommendations. we found that in order to ensure adequate funding for new peer kerman to research and development, there was no choice but to also reduce force structure. now to be sure strengthening the future military contains real risks. as a smaller force no matter how ready are technologically advanced we can go to fewer places than do fewer things, especially specially when

confronted by multiple contingencies or a scenario in which -- is required however attempting to retain a larger force in the face of potential sequester level cuts would create an effective decade-long modernization holiday on top of the program cancellations and delays already made and while the odds of the major conflict against another technologically advanced military power are relatively low the consequences of being unprepared for such a contingency could be catastrophic. we also have to consider how these cuts to investment funding may impact the availability of the private sector industrial base in strategic assets. in the recent budget decisions we were guided very much by the lessons of past major drawdowns. after world war ii korea vietnam and to a less extent the cold war. in each case the u.s. military kept more force structure think

of it adequately trained maintain and equipped given defense budgets at the time. the defense department was thus forced to cut disproportionately into account the fund readiness and modernization. the worst example of this phenomenon was the military of the 1970s. that is why for many parts of the military secretary hagel chose to reduce capacity, the quantity of forces available for global engagement deterrence and crisis response. in order to ensure those forces were properly trained and clearly superior in arms and equipment. i also know mckinsey and others have written about the need to pare back the department overhead costs in the proverbial back office. the idea being that squeezing more savings out of that dock office copy the need to shrink the military further. during last year's skimmer we did take a hard look at the pentagon bureaucracy the office of the secretary of defense headquarters joint staff and agencies in field activities and

found that some reductions are necessary in some savings are possible however achieving savings in the military proverbial tale takes several years and produces significantly less in bankable savings than is commonly believed. furthermore analysis shows that dod's headquarters structures comprise just over 2% of its personnel and 1% of its budget. one always said and done an enterprise of the u.s. military size complexity and global reach requires a substantial administrative and support operation. these backend functions can certainly be done more efficiently with fewer contractors in fewer executives, generals and admirals plus their associated staff and that is why secretary hagel announced last summer he would cut civilian contractor personnel by 20%. the total savings however are a

fraction of the reductions required by either sequestration or frankly the president's budget over the next decade. the efficiency efforts extended to the services their force structure and operations maintenance as well. the navy for example is pursuing aggressive cost savings initiatives including reducing support contracts and achieving better pricing initiatives to maximize the possible size of their ship inventory, however these efforts generally -- generate fewer savings and planner counted on in her budget there will be little choice than to further reduce the size of the navy's fleet. finally another the various proposals over recent years have been criticized as budget math, not strategy and when confronted with major spending cuts especially on the scale and schedule of sequestration there is no avoiding the imperative to seek savings and fast.

yet i would suggest the notion of crafting a strategy totally devoid of risks and totally dis- encumbered from resources is a logical fallacy and historical fiction. for starters a relative strategy is not to set goals and preferences put together on the assumption and help with the money will just follow. in reality strategy requires a symbiotic relationship between resources outcomes and action. in the real world are military is provided with a certain level of funding as was the case in each of america's major conflicts enduring the riskiest periods of the cold war as well. as analysts and yes strategists we do an assessment of what this will buy in with the options are. it's an iterative process and these results are linked with major parties as ellen to the present. each strategic element in forms another on a path to final decisions.

the result of this feedback loop is a strategy that is neither budget driven nor budget lines. remember that even the largest defense budgets will have links as well as knowledge and ability to predict the future. so they always contain some measure of risk. i'm talking about risk in the pentagon at issue is not the ability of the u.s. to prevail against many adversaries but how long it takes and at what cost, material financial and human. that does not mean however that we can ignore or rationalize the strategic consequences of flushing the resources available for national defense. if we don't like a strategy that results in additional funding is required to allow for a different set of trade-offs and lower levels of risk. for this budget plan we added the $115 billion above current law in order to have a

reasonable opportunity to fulfill the president's strategic priorities albeit with higher risk for certain military missions. this brings me to the sequestration slated to return in current law and fy2016. as a result of the last few months of analysis we were able to identify with some decision with the post-sequestration military would look like a over the next decade. that means significantly fewer ships including at least one less aircraft, dropping the army down a bit further to 420,000 active-duty soldiers ,-com,-com ma cutting more air force squadrons delaying or curtailing the purchasing of joint strike fighters and other platforms critical to u.s. air superiority and shorteninshortenin g combat units of spare parts, basic maintenance and the ability to to have complex military

training. consider most significasignifica ntly the kind of world that could follow several years of sequestration. the u.s. could not respond decisively to simultaneous aggression by two states thus inviting military adventurism by potential adversaries. our forces could not play quickly and in strength to respond to disasters overseas or other contingencies that require america's leadership. some allies and partners would be more likely to hedge their bets and cut side deals with their larger and more aggressive neighbors and finally america would remain the world's military power but would no longer be the guarantor of global security that can be counted on to protect our values, interests and allies. these are the kinds of scenarios we need to consider, the kinds of discussions we need to have. after looking at these issues carefully analytically with real

data for many years as recently helping secretary hagel for the recent budget review i know this much. pretending that a return to sequester is not harmful is the most harmful thing that we can do. there needs to be a serious national dialogue on what is sensible, sustainable and strategically sound defense budget looks like. we believe that we have proposed that budget this year. if our elected officials and body politic conclude that they truly want a diminished role for the u.s. in and the world and we can start ratcheting back the corresponding military investments and force structure but as i wrote a few months ago after being at the pentagon the first time around let's drop the illusion that by efficiency and managerial talk the u.s. military can absorb cuts of the size and of this immediacy without significant consequences. as defense leaders we must

prepare our institutions for leaner times and make sound choices. the country as a whole including its elected leaders need to understand the strategic and human consequences of reducing drastically the resources available for national defense and in so doing reducing america's role in the world as a global power and a force of stability. it is up to all of us in government and out, to make the case and make the choices necessary on behalf of the men and women in uniform for our country's security and credibility as a global power. so thank you again for this opportunity to speak with you and now i look forward to your questions. [applause] >> thank you so much. we are still going to get ms. fox out of here on time this

morning. as you know she is very generous and is a very busy woman. thank you very much. it's very enlightening and i agree with you. we are on agreement on pretty much everything. we spoke yesterday at the pentagon and another enlightening conversation with the secretary and if you could clarify perhaps a little more notches for me but really for the audience. there are two budgets but there is one -- coming over but in the budget that's coming over that is slightly higher the 115 billion that you outlined are basically off ramps for policymakers and dod. some of them are and in some of them are out however but you still have a long list of options that you pull from so it may not be clear to policymakers right away. for example you clarified yesterday at the pentagon that's a consequence of sequestration is an army that drops to 420,000 active-duty soldiers. that is built in the budget. you hope that you don't have to

do that and understand that but there are other things like the aircraft carrier that are in the budget but that you could take it out if you need to be funding does not materialize. could you walk through what is baked in an baked out of this cake? >> i think please try harder we couldn't have made this budget more complicated. so it's very hard to explain. there are multiple budgets and vetted in this submission so maybe i could just walk through the list even more than i did yesterday if that would be okay for this audience. first of all we will include a description of the force forest that i touched on in my remarks on what the sequester force will look like. we actually have the services produced at sequester level for the first time so that is the first time we actually have the detail necessary to clearly show do you like this picture and if you do they keep going on the sequester path. that will be not submitted at budget level even though we have

added the pentagon but the description included in the budget. that leads me to the actual budget which has two budgets and it. we did this planning and as i said in my remarks complex force structure takes time to get out and is really hard to plan for so bringing the army down smartly not the way we have done it before meaning the swiss cheese army but an army that remains capable as you bring it down is hard. it takes a lot of time and planning and the army and marine corps did that planning. we left that in the budget but we know where the offerings are so forget assurances that we are going to the president's budget level in 16 rather than sequester we will plan that offramp and put that into the budget's mission next year in the year after. the aircraft carrier is another one. we have to take a carrier out of sequester. again you have to plan fueling in the yards and all that planning so frankly that

planning is still in the budget but in 15 we will kind of cold. we won't take the people out. we won't take the air wing out. we will put the ship in the yards and start the actions that you would take whether you are going to refuel it put it back in service or take it out of service so we have time. again if we get some assurances that the budget is going up instead of down in fy16 we will keep the carrier. if however we go back to sequester we really have no choice. it's true that the budget is higher, $115 billion higher so what we try to put in there are things that we could reverse more quickly than the kinds of really complicated things i just mentioned. so programs he would just cancel or parts of our structure you would just take out immediately like the kc-10's or an fortunately readiness which we

put a lot of investment and in the $115 billion that again we just have to stop doing. it's a complicated story as i have said and thank you for the question. he gave me a chance to at least walk you through what we have tried to do. >> i will offer one comment in sympathy to you and your colleagues. as sequestration hit last year and the comptroller sent over his report and there was one from the pentagon last summer you are coming off the continuing resolution and sequester and then there was a budget finally and then there was sequestration. maybe i reversed the order but they all three came back to the session and even to look back a year ago was very complicated to get a clear sense of what the impact of last year sequestration so i know we are talking about the moment. when i try and look back i know congress really struggles with this to be sure. i would just say in great

sympathy to you that this is a very cloudy budget picture and my only worry is that because it's so complicated again it's hard to get capitol hill to be as sympathetic as we are. it's very confusing and i know that's not your fault. one question on your navy yard. you mention specific in the comments and i know will be of great interest to the audience in washington but if there aren't certain savings that you get out of contracts and shipbuilding in particular you would have to make other decisions to free up funding do you -- will you elaborate on a that quickly please? >> it's actually a rod package of acquisition related deficiencies that the navy has proposed this year. we touched on efficiencies and we have all pushed on efficiencies. 200 really in today and we have another package this year so we

think efficiencies are important but when it comes to the agency it's difficult to count on it. you want to have efficiency because you are going to be tougher in your contract negotiations in going to get more stability and be a partner with the industry or you were going to live with fewer support contractors than you planned. the navy did really detailed work on that this year and they have projections and we are excited that they did that because if the whole department could do that kind of thing we could do even better with the money that we have which is obviously the goal but i did want to mention that we are counting on those predictions. they were able to keep force structure slightly higher than what we predicted in the skimmer because of those efficiencies so it reinforces the points you have made on the value of efficiencies. the more efficient we get the more efficient for structure we

can keep. on the other hand there's a bit of gamble he here and i'm excited the navy is giving it their best shot and secretary and kendall and i looked at it hard and we are fully in support of them and hoping their successes will migrate across the whole department created. >> that's fantastic. we will be watching that closely. we are going to open it up to questions from the audience. we have about 15 to 18 minutes. please wait for the microphone. >> george nicholson a policy consultant with actual operations. i was on capitol hill yesterday on the seminar services committee before senator mccain put the hold on the nomination. one of the questions is in your inputs in the budgeting concerns the concern about retiring the a-10 which the senator from new hampshire is adamantly against

senator blumenthal says he will reconstitute a combat rescue helicopter program. the issue right now with the army and the big battle they are having in reducing the car both the air force but with those inputs of those change what kind of impact will that have on the budget and where does the money for that come from? >> thank you for that question. this is our annual challenge and it has been frankly since the first 487 billion-dollar reduction in the budget. we worked very hard in the department as i know this audience appreciates to take a holistic view and it's a tightly crafted package where if you don't get this something else comes out and then it goes to the hill and they take it piece by piece. i wish i had a magic solution. all i can say is we are going to do everything in our power to explain those trade-offs. if they force, as they have every year, is to keep things

that we don't want to keep something else happens and we are at the point even with a 115 billion additional there are few places -- few places i can come out and it ends up coming out of readiness or we end up slipping and sliding with programs even more expensive. we are up there trying to make that case and trying to do a lot of that myself. i have done a lot of the analysis behind these things for the guard for example. the secretary asked me to establish a tiger team with the guard in the army to put together the facts and come up with a balanced fact-based rationale behind all of our reasons and we are continuing to work to see if we can't come together on this and not fight ourselves and kick it to the hill. things like that we are working as hard as we know but frankly we also need your help. everybody here could help us make the case and force us to keep something we don't need an

and something we need where at the point where we have to take it out somewhere else. >> thank you. >> absolutely. of great interest to aei as well. >> thank you. richard from the british embassy. you mentioned the upcoming pdr and with the degree of budget uncertainty i am berry relieved to hear what you describe as slightly opaque but there does seem to be uncertainty on what sort of budget you could base a strategy on. clearly you need to have a strategy. can you give some sort of indication of the thinking of how your pdr can come out given the extent of the uncertainty? >> absolutely. qdr as i know this audience knows it's supposed to be fiscally unconstrained.

it's a the strategic aspirations of the department and it didn't do that. that's just the bottom line. we made a choice. i think of this qdr as the qdr that looks to achieve the defense strategic guidance slightly refreshed but in a resource informed more austere way and to articulate clearly what we would do, with the geostrategic context is for that the gst came out two years ago and looking at what the resources as i pretty much just laid out will support and where the risks are and then a little bit on sequester. qdr tracks very closely with the kind to remarks that i just made and you did it in an iterative way because we really did want to put forward in this qdr a few of the world that just didn't match the reality.

>> christine this is great to hear. i'm with opposed nay will graduate school. one of the things that struck has struck me in the last two years as the importance of storytelling and what i find is people who are part of the inner circle when they write it, they can understand it. they don't test it. in many ways is kind of like the problems we had with the health care. they didn't go out and see if it works in those at the bottom who will have to use it. i guess my suggestion is you might want to bring a random collection of people together to look at it to see what they don't understand. i just went through something like this last week with the navy admiral and all of a sudden when he presented it the audience got it so it makes a real difference doing those tests with people who don't understand the detailed.

>> it's a terrific suggestion. thank you for that and we should do that. i'm going to take that back because we aren't communicating. we were not able to communicate the impact of the sequester last year because we talked about readiness and nobody knows what readiness is. i have the opportunity to do an npr interview and i knew, my great staff helped me. if you use readiness it's not going to communicate so i talked about having your teenager drive to ohio in a snowstorm. you want to make sure they can drive. you want to make sure they can drive in snow. you want to make sure their car works and it's been service and if it breaks down they have a spare tire. that is what readiness is for all of our ships and airplanes and tanks and so forth. it's a little longer than the word but i think those kinds of points that you are making are so important. we go into the pentagon and i

get it so trying out our story on these outside groups is a triptych ideas so thank you. >> to your point and questions i was thinking about her a conversation this morning and yesterday and i was literally, i'm so frustrated with the pentagon's inability to get to congress. it's kind of the first question in the audience and it's not just people focused on the hardware but it's about the national guard and retiring fleets of aircraft and ships and other priorities. i was thinking in terms of what would that be like and i haven't given this enough thought is you will find out he my 3-year-old son i said what if i taken to the hairdresser and i say you have to take an inch off of his hair but don't take anything off of the front or or the sides of the back or the top. when they sent the budget d. they were going to fence off

anywhere from 1/2 to two-thirds virtually cutting everywhere and the one third that is military personnel compensation particularly. understand the messaging and it's something we give great thought to. aei. do we have any more questions? >> thomas frist berg. my question has to do with right now and i think you acknowledge to our conventional forces are in the near-term going to be superior to any of our adversaries so what you are really at is terrorism cyberwarfare and other asymmetric attack dix and yet we talk about needing extra aircraft or joint strike fighters and i was wondering is there discussion in putting money into current weapon technologies that are probably built for an enemy that doesn't

exist at this point. is that going to hurt us 20 years down the road when they conventional adversary such as china may rise? >> so said another way are we living in the past with our force as we move to the future. we have to move to the future and the budget does for example we actually took out more air force structure than we would like to protect the new long-range bomber and we are detecting cyber. we are texting soft so the aspect is the force we see wearily vital for the future are protected at the things like aircraft carrier, we thought in the skimmer be would have to go down to nine or eight with sequester and i think your study also took the carriers down more the outcry of going to 10, if

not had any more calls on anything than that and i am by my own admission an aircraft carrier analyst myself so i have a lot of experience with this and i get it. it's incredibly important capability in the force. it's a huge simple -- simple. look at how china is trying to announce if they are going to push a their aircraft carriers. we we are putting him in a position where he has to look the global community and i and save we are bringing our air carriers down at the same time china is trying to build them. your point is spot on. if we think it's important got to be able to play and is not the first time carriers have had this problem. in the whole cold war the soviets put enormous energy enormous money into taking out the aircraft carriers and the strikers and that is how i cut my teeth in this business, figuring out ways to make it

survivable and actually we did an awful lot in those days. none of those things would work in today in today's world but we are so used to dominating and we don't spend anywhere near the money we should on electronic warfare and deception and other things like that can make a huge difference and in this budget environment we can actually afford things like that. we need to be more creative so that's .1. joint strike fighter is another program that suffers from the same challenge of how can we talk about shorter range in a world where they are pushing us further and further out and i think the same point comes in, we have to recognize jsf is the only jet we have built that is built from the ground up to be survivable in a challenging bw environment for example. that's a tremendous capability.

we haven't started to figure out what we can do with that capability and there are phases two and a complex the early phases may not be all to use jsf but eventually you can get in there. so across the spectrum i think your point is very good and it's not lost on us. we have to make sure that the platforms we have today can work tomorrow and we are preferentially trying to protect those investments. >> in fact what we did briefly at the exercise which last summer as ms. fox knows we conducted a management review and had the opportunity to discuss that with you and this winter it was a shadow 2015 budget/qdr and what we found it aei basic he was we have to cut further than sequester levels in the budget year that you are and so you could free up money to

make investments in electronic warfare and other enablers like she talked about combat logistics as well as space and satellite so you take bings down even further than the sequester asked for and it's a difficult situation and all the more reason why you look for additional help in funding. >> thank you for saying that. that is very true and very important for people with understand. >> hi. i mary walsh with cvs news. i wonder if he you could expand on your remarks drawing down the armies smartly. you have a force now that is highly-skilled in combat and i was recently at some training and when you have combat veterans conducting training it's a totally different game out there. yet it is those seasoned combat veterans that are potentially the ones that will be taken out of the army or forced to retire

or just leave the army. how do you draw down the armies smartly? >> so the army is extraordinarily capable right now in counterinsurgency operations for example. one of our challenges for all the force, not just the army is we have to rebalance the force towards full spectrum operations so we actually feel in addition to the challenge that you rightly raised we have to actually add readiness investments to the army to help them recover their full-spectrum capabilities and again this is a readiness challenge we face across the entire force so as we bring down the army we want to have the money to keep the army we have at that time ready and repurposing for a globally available for some any type of conflict so we need to keep

those seasoned combat veterans. we can't let them just leave the force. if we were to be sequestered and we took the army down immediately we would lose all of those people just as you suggest and we would not have the money to rebalance in the way that i described. so that is what we mean by smart while we have a force, the size of that force we want to be capable and the next year will get a little smaller so we will need that force to be capable and so forth. we are really going to have the readiness dollars to keep the whole force capable of we have to try to manage through that. the quicker you take down the force the more you break it and lose the very talent that you need, the quicker you take down the money will you keep the force large the less ready it is so it's a really tough set of trade-offs. you try to make the army. the army has done all this very hard work which is why we left it alone. how do you bring it down relative to the budget you expect to have, keep it as ready

as possible until you reach that end state where the money is enough to keep the force that you have modern and ready for today's world. that's just going to take time and the more time that we have smarter we can do it and hopefully that answered your question. >> we will take our last three and go here, here and here and then we will finish. >> hi good morning. megan was defense daily. you have spoken about the challenges of trying to cut from the tail instead of the two. i wonder how you look at things like dod schools base operations and from a services perspective how they are looking at the battlefield setting type things and whether that is falling into tooth or tails when you are looking at where to cut. >> we you're looking at everything is on the table and

it has been for a couple of years. schools are on the table. we looked at schools. scammer went from very benign efficiency initiatives all the way to very aggressive that included the schools and then we turned it over to the chiefs and the joint staff and the chairman reid a process and they concluded that schools were really important to the quality of life of the military families their kids are out of school all the time. some confidence that dod is going to make sure we provide for their families education was important to the future force recruit and retain so we honor their perspective obviously. the compensation package they have come up with this frankly hard enough but we looked at it and i want you to know that we lifted everything. you talk about the logistics and things like depp does so yes we have looked at that as well.

here's the situation. there are lots of things we could do and would actually like to do to reduce the base infrastructure. we have about 25% more bases and installations than the size of our force would require and that is why we ask for rack and 2017. it's dead on arrival but we needed. to consolidate depos we need a brac so all awful lot of our dandified efficiencies for logistics have to be part and parcel of a brac. if you put brac in the budget in the early years it cost money and the later years it saves so in this submission with brac starting in 2017 there's not a lot of savings but we put the money in to pay for brac because we feel we needed so badly for the very reasons that you suggest. >> thank you. right here up front.

>> i am from south korea. how many army troops would affect the presence in east asia 28,500 troops are stationed now. secretary hagel said he wants a substitute you too with global hawks and this is a technical question. do you want the allies of the country to substitute with their own global hawks . .

was one of the strategic imperatives has an input is besides the army and other forces for that matter. so there will be no impact at all in our agreements or commitments to korea and we made sure that as we went through. the challenge for the smaller army at 44450 we believe it's manageable of course. general odierno would prefer more flexibility but it gives him enough flexibility to meet the requirements that any korean contingency would require to sustain our commitment to the forces on the peninsula and protect the homeland but the smaller the force the less else you can do. it's not korea. korea was an input. on youtube and global -- you too and global hawk generally speaking anytime we can work closely with our allies and share capabilities and equipment it's a good thing so we have been back-and-forth on

the u2 and block 30 decision and i would say it has always been a close call. when we looked at it this year the operating and sustain the cost of the global hawk block 30 have come down significantly. the contractor perhaps because we said last year we weren't going to keep it became very aggressive to help us get those costs down and we are appreciative that and of course the air force is working very hard themselves so i don't want to take away any credit deserving to the air force for getting those costs down. with those costs down and make sense to keep the global hawk block 30 and the implications to our allies is something i look forward to working with you on. >> very quickly last question please. >> hi. a similar question. secretary hagel said you also

mentioned the pentagon -- [inaudible] so i wonder what kind of an impact this would have on the region on southeast asia. thank you. >> if i understand the question you're you are asking about her strategic imperative to rebalance to the asian-pacific oarm does this budget supported and the shorter answer is yes just as our commitment to korea and plans for korea was an input to the budget so was the rebalance. we intend to continue to do a lot of the things that we are already doing. for example the marine corps are deploying to australia and doing operations in australia for the first time in a very long time. we are continuing with putting lcs and in singapore we have to bear in two more are going.

the president or secretary both are making numerous trips to the asia-pacific ale ward and with regard to the critical capabilities that we need to operate successfully in that region now and in the far term essay is mentioned -- had mentioned the preferentially protected those capabilities like the submarines in the bombers. 60% of our fleet is oriented toward the asia-pacific oarm the future so i think the rebalance to asia is very real. it's a continuation concern. it's part of everything we are talking about from managing the secretary's travel plans to the inputs that we make to the budget. >> it's a great question to conclude conclude with and i have learned so much more about the defense budget spending this time with you and i want to thank you so much for your time. you were nice to take questions from everyone. thank you all for coming

the senate appropriations subcommittee on labor health, human services, education and related agencies will please

come tord ore. today's hearing is the sixth that this subcommittee has held since 2000 focusing on alzheimer's disease, the burden of the disease, the state of the research and the challenges faced by caregivers. going back many years, we've heard predictions from experts about the far-reaching consequences this disease will have on the quality of life for american families and the burden it will place on our economy in the years ahead. last april, a major study predicts that these consequences will be far greater than anyone even previously imagined. we'll hear from the author of that study today on the next panel. i won't steal his thunder, but i note this study commanded the attention of the nation, in particular this subcommittee. there are few americans whose life hasn't been touched in some way by alzheimer's disease. whether through a family member or a friend. it's the most common form of dementia among older americans and its risk increases with increasing age. for those living with the

disease, its ravages get worse over time as does the burden on their families and on society. the number of americans living with alzheimer's has doubled since 1980. the growth will almost certainly accelerate as the baby boom generation continues to retire in the future. the federal government's involvement in alzheimer's disease research began in 1976, when three institutes at the national institutes of health invested a total of $3.8 million in research into the cause of this disease. we now spend approximately half a billion dollars each year on research into alzheimer's disease. we've had some successes along the way, but the harsh reality is that we still do not know how to prevent, reverse, or definitively diagnose alzheimer's disease. more research is desperately and urgently needed. this subcommittee has always adhered to a strong policy of not earma